1.01 Fee Panels and Fee Personnel

April 6, 2005VBA Manual 26-2, Revised

Chapter 1 Fee Personnel

Overview

Introduction

/ This chapter contains information about the Department of Veterans Affair’s (VA’s) use of fee appraisers, fee compliance inspectors and other technical fee personnel.

In this Chapter

/ This chapter contains the following topics.
Topic /

See Page

1.01 Fee Panels and Fee Personnel / 1-2
1.02 Fee Panel Qualification Requirements / 1-3
1.03 Fee Panel Appointment Process / 1-5
1.04 Conflicts of Interest / 1-8
1.05 Exemption to E-Appraisal / 1-10
1.06 Fee Personnel/Performance Files / 1-11
1.07 VA Use of Other Technical Fee Personnel / 1-12
1.08 Fee Personnel Training / 1-13

1.01 Fee Panels and Fee Personnel

Fee Panels

/ Each VA office will appoint and maintain a panel of fee appraisers and a panel of fee compliance inspectors to conduct appraisals and inspections for VA Loan Guaranty program purposes.
The same individual may be appointed to both fee panels, if qualified.
Each fee panel will contain enough members to accommodate all appraisal and inspection requests expeditiously. A qualified list of appraisers and compliance inspectors must be maintained through such recruitment sources as newspaper advertisements, local appraisal organizations, state appraisal license and/or certification rosters, etc.
Qualified VA staff may perform appraisals and inspections for VA loan guaranty purposes, if necessary, in the absence of qualified fee personnel.

Fee Personnel Are Not VA Employees

/ Fee personnel are independent business people. As such, they are responsible for the quality of their work.
As independent business people, VA fee personnel are primarily responsible for the billing and collecting of appraisal/inspection fees. C&V staff at the local Regional Loan Center (RLC) will provide assistance for those overdue billings when requested with documented past collection attempts.
Although fee personnel are not VA employees, they must be given due process prior to any VA administrative action being taken against them unless he/she is still within the 1 year probationary period on the panel, during which he/she can be removed at the discretion of the VA office Director.
Reference: See Section 6.08, VA Administrative Sanctions Against Program Participants.

Information Sharing

/ VA offices will provide a copy of their list of fee panel members to the Department of Housing and Urban Development or Rural Housing Service, upon request.

1.02 Fee Panel Qualification Requirements

List of Requirements

/ An appraiser or inspector must meet all of the following qualification requirements prior to appointment to a VA fee panel:

At least 5 years ofexperience (in the type of work that would qualify the applicant to competently perform the required duties in the area(s) where the applicant wishes to work) for appraisers, and 3 years experience for inspectors.
Appraisers must be currently licensed or certified by the State.
Inspectors must meet local or State licensing or certification requirements, if any.
Good character (no indication of any cause for embarrassment or adverse publicity for VA).
Not currently employed by the Federal Government or a quasi-governmental organization (such as Fannie Mae, Freddie Mac, Postal Service, etc.). May be a local or State government employee if no conflict of interest (or the appearance of a conflict of interest) with VA assignments.
No other conflict of interest between current employment or other position or private pursuits and VA assignments.

Reference: See Section 1.04 Conflicts of Interest

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1.02 Fee Panel Qualification Requirements, Continued

List of Requirements

(continued) /

With regard to VA testing:

Appraisers must provide a satisfactory demonstration appraisal (on the Uniform Residential Appraisal Report form) to include a certification that no assistance was received in completing the report. Note: Appraisers should be able to electronically transmit their demonstration appraisal as a Portable Document Format (PDF) file via e-mail (e-commerce).

Compliance inspectors must provide a satisfactory demonstration inspection (on VA Form 26-1839, Compliance Inspection Report) and pass a written test that measures the applicant’s knowledge of construction techniques and terminology.

Note: VA offices will furnish appropriate information and instructions prior to testing. Appraisers will be advised if electronically transmitted e-mail appraisals as PDF files are required and if required, specific e-mail submission instructions will be given.

.
VA offices will use the Credit Alert Interactive Voice Response System (CAIVRS) to screen each applicant for delinquent Federal debts. Satisfactory arrangements must be made to repay any delinquent debt to the Federal Government.

1.03 Fee Panel Appointment Process

Fee Panel Application

/ An applicant must complete and submit the following to the VA office of jurisdiction over the area in which he/she wishes to work:

VA Form 26-6681, Application for Fee Personnel Designation, and
Letters of reference:

-Appraisers: Three letters required, at least 2 of which must be from licensed or certified appraisers attesting to the applicant's qualifications using references listed on the application. (38 USC 3731(a)(1))
-Inspectors: Submit 3 letters attesting to the applicant's qualifications as an inspector using the references listed on the application.

Initial VA Processing of Application

/ Upon receipt of an application, the VA office will initially notify the applicant acknowledging its receipt within 5 working days. The VA office will review the application in a timely manner, and then notify the applicant by letter. The letter will either state that the applicant:

Does not meet a basic qualification requirement (e.g., experience, licensing/certification, conflict of interest) and name the specific requirement(s), or
Meets the basic requirements and is being considered, along with other eligible applicants. This letter may also initiate testing, request the applicant’s Social Security Account Number (if not already provided) for CAIVRS screening, or request or provide other information.

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1.03 Fee Panel Appointment Process, Continued

VA Selection of Fee Panel Members

/ Every VA office will have a Fee Panel Committee consisting of:

Loan Guaranty Officer (Committee Chairperson),
Assistant Loan Guaranty Officer (or other qualified employee designated by the Loan Guaranty Officer), and
Valuation Officer (VO) or other qualified employee designated by the VO.

When a VA office determines a need for an additional fee person in an area, the Fee Panel Committee will:

Review the pending applications,
Determine who is best qualified, and
Make a recommendation to the Director.

Note: Valuation Officer must include documentation in the personnel file of each selected applicant confirming the required experience and training of the selected candidate meets all requirements for the position to which they are being appointed.

VA Notice of Fee Panel Selection

/ The VA letter to the individual selected for the fee panel will:

Welcome him/her to the fee panel,
Remind him/her of the responsibilities regarding quality of work and demeanor when representing the agency,
State that the first year on the panel is a probationary period, during which he/she can be removed at the discretion of the VA office Director.
Include a “training kit” of reference material regarding applicable VA requirements (e.g., VA Lender’s Handbook Chapters 10 through 17 and locally developed training material) and a list of frequently encountered errors for appraisers and/or inspectors, and
Be signed by the VA office Director.

VA offices may require fee personnel to use VA Form 26-8709, Identification Card For Loan Guaranty Fee Personnel. A photograph of the fee person can be laminated in the area designated as “Fee Personnel”.

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1.03 Fee Panel Appointment Process, Continued

VA Work Measurement

/ Direct VA labor hours spent processing fee panel applications may be reported as “Other Measured Hours” for work measurement purposes.

1.04 Conflicts of Interest

Conflicts of Interest Prohibited

/ The Federal Government or a quasi-governmental organization (such as Fannie Mae, Freddie Mac, Postal Service, etc.) must not currently employ VA fee personnel. The fee panel member may be a local or State government employee if no conflict of interest (or the appearance of a conflict of interest) with VA assignments.
VA fee personnel must not engage in any private pursuit that could result in either:

Conflict between the fee person’s private interests and his/her VA fee panel responsibilities,
Bias of his/her judgment as a VA fee panel member, or
Use of information obtained through a VA assignment to the detriment of the Government or veterans.

VA fee appraisers who are also staff appraisers for Department of Housing and Urban Development (HUD) Direct Endorsement (DE) lenders must:

Disclose that fact to VA and
Not accept VA assignments on properties in which their employer has an interest.

Continued on next page

1.04 Conflicts of Interest, Continued

VA Oversight

/ If there is an indication that a fee panel member’s private pursuits/interests conflict with VA requirements:

He/she will be promptly notified, and
VA will immediately take appropriate action (e.g., withdrawal of pending assignments and/or withholding of further assignments) pending outcome of an investigation.

When appropriate, VA will administratively sanction the fee person.
References:

Section 6.08
Chapter 17 of the Lender’s Handbook

1.05 Exemption from E-Appraisal

Justification

/ An exemption from the requirement that VA fee appraisers submit their appraisal reports via E-Appraisal may be granted in the following situations:

The appraiser is assigned a geographic area that generates few requests for VA appraisals (typically 1 or 2 a month) and
There is a lack of qualified appraisers in the area and it is in the best interest of VA to retain the appraiser and
The appraiser requests an exemption based on hardship and it is in the best interest of VA to retain the appraiser.

Distribution by Overnight Mail

/ If exemption from E-Appraisal is granted, the appraiser must send the appraisal by overnight mail delivery to:

VA (Individual/IND or Liquidation/LGI cases).
Lender Appraisal Processing Program (LAPP) lenders (LAPP cases).
Requesters for liquidation appraisals with Portfolio Loan/LPL prefix.

Requesters for liquidation appraisals with the annotation Servicer Loss Mitigation Program or “SLMP”, that requests E-Commerce submission.

Note: In LAPP, LPL, or SLMP cases, a copy of the appraisal must be mailed to the VA. In these cases, regular mail may be used.
Reference: VA Lender’s Handbook, VA Pamphlet 26-7, Sections 10.04 and 11.05

1.06 Fee Personnel/Performance Files

File Contents

/ VA offices will maintain a personnel/performance file for each fee panel member in FileNet.
The file will contain:

The application to the fee panel.
All correspondence or other documentation concerning appointment to the fee panel (including, but not limited to tests, reference letters, etc.).
Evidence of current license or certification (electronically or otherwise) and evidence of inclusion in the (The Appraisal Subcommittee of the Federal Financial Institutions Examination Council) ASC National Registry. The registry can be found at
Detailed documentation regarding work assignments, including copies of letters, records of telephone conversations and personal contacts, etc., regarding the quality and timeliness of the fee member’s performance, and
Correspondence or documentation concerning any temporary or permanent removal from the fee panel for any reason.

Note: All pertinent documentation regarding work assignments and disciplinary actions should be retained in the file.

1.07 VA Use of Other Technical Fee Personnel

Who May Be Used

/ VA offices may use engineers, architects, or other technical experts as needed on a contractual fee basis.

Other Technical Fee Personnel Are Not VA Employees

/ All fee personnel are independent business people, not VA employees. As such, they are responsible for the quality of their work.

Payment Considerations

/ Contracts with fee personnel must be written to:

Avoid any provision that would tend to establish an employee-employer relationship, and
Provide for payment per job, as opposed to a per diem rate.

Contract costs must be paid by the builder if the need for the service is attributable to acts or failures for which the builder is responsible (e.g., inadequate engineering data, etc.).
Contract costs can be paid by VA if the facts in the case indicate that the need for the service is either:

Essential to fulfill VA responsibilities,
The consequence of actions or omissions of VA staff, or
Otherwise in VA’s interest.

When contract costs are paid by VA:

Payment must be made from VA funds allotted for miscellaneous contractual services, and
Funds must be formally obligated prior to authorization to proceed with the assignment.

Contract costs can be paid by both VA and the builder if the need for the service is properly allocable to both VA and the builder. In this situation, VA will make the decision regarding distribution of the costs based on the facts in the case.

1.08 Fee Personnel Training

Quality Assurance

/ To ensure that appraisal and compliance inspection reports continue to meet VA expectations, communication between the fee personnel and VA is essential.
VA staff must hold and document annual meetings with fee appraisers and compliance inspectors. These meetings ideally would be conducted in an open forum where information and ideas may be freely exchanged. However, where not practicable, private meetings may be conducted. During these meetings VA staff should:
Provide training on any changes in the appraisal/inspection requirements or program requirements.

Furnish updated training manuals/materials.
Discuss timeliness requirements and customer service initiatives.
Answer any questions the appraiser/compliance inspector may have, and
Consider any suggestions made by the appraisers and compliance inspectors.

Additional meetings may be appropriate depending on circumstances. Lack of travel funds should not be considered an acceptable reason for not holding such meetings. Alternative meeting methods may be considered; i.e., video conferences, online video meetings etc.